Supply chain – The COVID 19 pandemic has certainly had its impact influence on the world. Economic indicators and health have been affected and all industries have been completely touched in a way or perhaps another. Among the industries in which it was clearly apparent would be the farming and food industry.
Throughout 2019, the Dutch agriculture as well as food sector contributed 6.4 % to the disgusting domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands dropped € 7.1 billion in 2020. The hospitality business lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have major consequences for the Dutch economy and food security as a lot of stakeholders are affected. Though it was apparent to most folks that there was a significant effect at the conclusion of this chain (e.g., hoarding doing food markets, eateries closing) and at the start of the chain (e.g., harvested potatoes not finding customers), there are a lot of actors in the supply chain for which the impact is less clear. It is thus important to find out how well the food supply chain as a whole is actually prepared to contend with disruptions. Researchers from the Operations Research as well as Logistics Group at Wageningen Faculty and also out of Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID-19 pandemic throughout the food resources chain. They based the examination of theirs on interviews with about 30 Dutch source chain actors.
Demand within retail up, in food service down It is apparent and widely known that demand in the foodservice stations went down on account of the closure of restaurants, amongst others. In a few cases, sales for vendors of the food service business thus fell to about 20 % of the first volume. As a complication, demand in the retail channels went up and remained at a quality of aproximatelly 10 20 % higher than before the problems began.
Products which had to come from abroad had the own issues of theirs. With the shift in desire coming from foodservice to retail, the need for packaging improved considerably, More tin, glass or plastic was required for wearing in consumer packaging. As much more of this particular product packaging material ended up in consumers’ houses rather than in joints, the cardboard recycling function got disrupted also, causing shortages.
The shifts in desire have had a major impact on output activities. In a few instances, this even meant a total stop of output (e.g. inside the duck farming business, which emerged to a standstill on account of demand fall-out inside the foodservice sector). In other cases, a significant portion of the personnel contracted corona (e.g. to the various meats processing industry), leading to a closure of equipment.
Supply chain – Distribution activities were also affected. The start of the Corona crisis in China caused the flow of sea canisters to slow down fairly soon in 2020. This resulted in transport capacity which is limited throughout the earliest weeks of the problems, and high expenses for container transport as a result. Truck travel faced different issues. At first, there were uncertainties about how transport would be managed for borders, which in the long run were not as strict as feared. The thing that was problematic in instances that are most , however, was the availability of motorists.
The reaction to COVID-19 – deliver chain resilience The source chain resilience analysis held by Prof. de Leeuw as well as Colleagues, was based on the overview of this primary components of supply chain resilience:
To us this particular framework for the assessment of the interview, the findings show that not many companies were well prepared for the corona crisis and in fact mainly applied responsive practices. Probably the most important supply chain lessons were:
Figure one. 8 best practices for meals supply chain resilience
To begin with, the need to create the supply chain for versatility as well as agility. This appears particularly challenging for small companies: building resilience right into a supply chain takes time and attention in the organization, and smaller organizations oftentimes do not have the capability to accomplish that.
Next, it was discovered that more attention was needed on spreading risk as well as aiming for risk reduction inside the supply chain. For the future, what this means is more attention ought to be given to the way organizations count on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization as well as smart rationing techniques in situations where demand cannot be met. Explicit prioritization is required to keep on to meet market expectations but additionally to boost market shares where competitors miss options. This particular challenge isn’t new, though it’s in addition been underexposed in this specific problems and was often not a component of preparatory activities.
Fourthly, the corona problems shows us that the financial result of a crisis in addition is determined by the manner in which cooperation in the chain is set up. It is often unclear exactly how further expenses (and benefits) are actually sent out in a chain, if at all.
Finally, relative to other functional departments, the businesses and supply chain functions are in the driving seat during a crisis. Product development and marketing and advertising activities need to go hand deeply in hand with supply chain events. Regardless of whether the corona pandemic will structurally replace the traditional discussions between logistics and creation on the one hand and marketing on the other hand, the potential future will need to explain to.
How’s the Dutch meal supply chain coping during the corona crisis?